Best Buy on Wednesday said it has acquired GreatCall for $800 million, according to a press release. GreatCall offers connected health and emergency response services to the aging population, has more than 900,000 paying subscribers, and says its annual revenue tops $300 million.
GreatCall offers mobile products and connected devices as well as a range of services to aging consumers, including one-touch connection to U.S.-based agents who connect users to family caregivers, provide concierge services, answer questions and dispatch emergency personnel, according to the press release.
GreatCall's headquarters will remain in San Diego and its care centers in Carlsbad, California, and Reno, Nevada. David Inns, who has been with GreatCall since its 2006 founding, will stay on as CEO, the companies said.
At first glance, this partnership may seem like a curious move for an electronics retailer. But considering Best Buy's expertise and the gap in tech-based health care services, particularly those that address the increasing needs of Baby Boomers, it might not be so surprising.
"A deeper move into personal health technology management was probably inevitable from Best Buy," Stephen Baker, vice president and technology analyst at The NPD Group, told Retail Dive in an email. "It builds on the overall ability of retail to connect directly to the end user and Best Buy's deep understanding of how to deploy technology to consumers and help them understand how to use it."
Best Buy says it will bring its merchandising, marketing, sales and services capabilities to GreatCall's services. The retailer notes that it already has a growing health and wellness products business, and has recently invested in health initiatives for older consumers, partnering with health care providers and insurers.
The move is also symbolic of the evolution of retail to providing more all-encompassing services than sales of goods, and Best Buy was already well positioned for that. Like Baker, GlobalData Retail Managing Director Neil Saunders sees the move as a logical evolution of Best Buy's proposition to customers.
"Over recent years there have been significant changes to the electronics market, including fierce competition from the rise of online. However, Best Buy has successfully navigated this new landscape — in large part because it has adapted its proposition and approach," Saunders said in comments emailed to Retail Dive. "One of the main changes has been the move from simply selling products to trying to help consumers select and get the best use out of new devices. In a sense, Best Buy now sees its role as helping consumers to improve their lives through technology."
Health care is ripe for this kind of advancement. Drugstore retailers like Walgreens and, most starkly, CVS Health, have moved dramatically from simply selling prescriptions and bandages to providing much more comprehensive health services and advice. Amazon and AARP, whose members are 50 years old or older, have reportedly discussed partnerships to research and develop technology for older people, including in healthcare, since 2015. According to Baker, this is a similar move to CVS and Walgreens, in that, "While they were able to deliver a lot of those services directly, they needed to acquire companies with specific expertise to more fully integrate into the marketplace," Baker said.
Healthcare services in and out of the doctor's office are increasingly tech-dependent or would benefit from technology, but health insurers and traditional medical practices don't necessarily use that, or a customer-service mindset. Best Buy is demonstrating that retailers beyond drugstores could fill the gap.
"For Best Buy (and others) I think this is smart because there is very clearly a synergy from retail and the personal one to one nature of retail to the increasingly personal and one-to-one nature of health care," Baker said.